Expelling Immigrants from the Exchanges

By Wendy Parmet

[Cross-posted from HealthLawProf Blog.]

The warning by the Centers for Medicare and Medicaid Services (CMS) last month that up to 115,000 people might lose their health insurance under the Affordable Care Act (ACA) unless they can send proof of their citizenship or immigration status was more than a bit ironic. After spending much of the year and millions of dollars trying to boost participation in the exchanges, CMS is now trying to reduce participation. In so doing, it will likely exclude many young, healthy adults, just the type of people that the exchanges need to succeed

The reason for the exclusion lies with the heated politics of immigration, and our ambivalent approach to providing immigrants with health care. Although the ACA’s critics have lambasted the law on many accounts, when the Act was first debated in Congress no charge – not even death panels! — was made more heatedly or drew more attention than the claim that the Act would cover illegal immigrants. It was that charge, after all, that Representative Joe Wilson referred to when he shouted “You lie!” during the President’s speech to a joint session of Congress.

Obama, however, didn’t lie when he promised that the Act would not cover illegal immigrants. The ACA bars from the exchanges immigrants who are “not lawfully present,” a category that includes the so-called Dreamers, the young immigrants who by virtue of an executive order have a right to live and work in the country. It also requires exchange applicants to provide their Social Security number and, in the case of non-citizens, information about their immigration status, which must be verified by the Department of Homeland Security. These are the requirements that CMS is now enforcing. 

Although the ACA may require CMS’s action, the expulsion of immigrants makes little sense. The ACA, after all, was premised on the notion that it is more efficient and effective for the government to subsidize insurance than to pay for emergency care for the uninsured. If that’s right, it’s hard to see how it makes sense to bar large numbers of immigrants from the exchanges, while continuing to pay for their emergency visits, as the federal government does through the so-called Emergency Medicaid program, which covers emergency costs for illegal immigrants.

Moreover, immigrants are an ideal demographic for the exchanges. Although we don’t know much about the specific immigrants who CMS may expel, we do know that as a class immigrants are younger and healthier than citizens. As a result, their participation in the exchanges may help lower the risk profile of plans sold on the exchanges, thereby lowering premiums and costs for the government. Moreover, the exclusion of those who cannot verify their immigration status may deter even lawfully present immigrants and citizens from seeking coverage in the future, either because they may fear they will be unable to prove their status, or because they may worry that the verification process will raise problems for family members whose legal status is less secure. If that happens, by enforcing the ACA’s immigration provisions, and doing so in a very loud and visible way, CMS may end up undoing much of what it has sought to accomplish this year – getting people insured.

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